Tourism set to gain with the infra push in the Union Budget 2017

The assertion may appear surprising to many of our colleagues in the industry as some of the more usual demands from the industry, like granting infrastructure status to the hospitality industry and other tax related issues have been left untouched by the government. The ‘T’ word may not have been adequately quoted in the Finance Minister’s speech, with little mention of references like hotels, airlines and travel, but this budget, in all its manifestations, is a resolute step towards addressing one of the long-standing lacuna plaguing the tourism industry – infrastructure. India, for the first time, will invest as much as Rs.3,96,135 crore in creating and upgrading infrastructure in 2017-18.


​Collectively, a sum of Rs. 2,41,387 crore has been set aside for roads, railways and ports. Railways, roads and highways will give India the essential infrastructure on which the nation will move, and therefore, travel and tourism will automatically benefit. With more highways and roads in the countryside, hotels, eateries, conveniences and other products that make a larger tourism product of the country will follow suit.​ The government has mandated the railways to lay down 3,500 kms of tracks in 2017-18 as compared with 2,800 kms in 2016-17. Meanwhile,

Rs.67,000 crore has been earmarked for national highways in 2017-18 as compared to Rs.57,676 crore in 2016-17. Also on radar is the construction of 2,000 kms of roads to boost coastal connectivity. A part of the larger Bharat​Mala scheme which envisages a road network spanning 5000 kms along the land border, coastal roads will open up new possibilities for the tourism industry. More than 2000 kms of coastal roads would be built in Gujarat, Maharashtra, Tamil Nadu and Odisha, creating new avenues for hotels, F&Bs, and other segments.

​The Ministry of Tourism has been allocated Rs.1844 crores, including over Rs.900 crores for integrated development of tourist circuits. In a first, over Rs.400 crores have been allocated for publicity and promotion of ministry’s programs and initiatives. It is a significant allocation, especially when the industry has been pressing for creating more visibility around the ‘Incredible India’ campaign. If coupled with state tourism departments, the overall outlay for nation’s tourism industry reaches substantial numbers.

The need of the hour, now, is to create synergy between the two spending to truly leverage the multiplier effect. A better centre-state collaboration mechanism needs to be put in place. We recommend looking beyond CMs conferences and tourism ministers’

conference which have been routine in the past, and a big question mark hangs on how productive have they really been.  States need to know each other, sharing best practices and worst failures for common good. Such sharing of knowledge will go a long way in creating more tangible results in our endeavours. At the state level, secretary and director-level exchanges must happen, to begin with, perhaps even quarterly.

The budget has ushered hope for India’s biggest untapped tourism asset – rural tourism. With focus on creating more infrastructural connectivity in the hinterland, a sum of Rs.19,000 crore has been allocated for Pradhan Mantri Gram Sadak Yojana (PMGSY). Digital India and Swacch Bharat Abhiyaan have been given a strong push. All of it will have a cumulative impact in making our villages more accessible to tourists, domestic and international – which will have a rub-off effect on rural economy, creating more employment avenues and, consequently, footfalls.

However, it is extremely important for agencies involved in the process to get adequately sanitized to ensure that our countryside does not lose its authenticity while it receives a much-needed dose of infra. With focus on rural rejuvenation, local ethos, building designs and material could get a new lease of life in the countryside.

On the aviation front, airport authorities have been authorised to undertake non-airport related development. A move which will lend new streams of revenue generation for airports, making them more sustainable in the long run. Airport infrastructure, especially, in the tier-2 and tier-3 cities will get a boost.

​ As much as 55,000 acres of land will get released for new development, unleashing new opportunities for affordable aviation infrastructure.  There are more hits than misses in this budget, and a long term sustainability for tourism is the surest gainer.

Leave a Reply

Your email address will not be published. Required fields are marked *